Current Issue

UNCTAD’s 2019 High-level IIA Conference: A new momentum for Phase 2 reform

There are several efforts underway at multiple levels—national, bilateral, regional and multilateral—aimed at reforming the IIA regime. These reform efforts are operating in parallel to developments in other areas of international investment governance, some of which have advanced quickly over the past year, including the structured discussions on investment facilitation at the WTO, as well as efforts in the UN context to craft a binding treaty on business and human rights. This year’s UNCTAD High-Level IIA Conference assessed the progress made to date since launching UNCTAD’s 10 Options for Phase 2 of IIA Reform, looking at trends across multiple areas of international investment governance, as well as across world regions. This ITN Insight summarizes the key takeaways from the 2019 event and considerations for Phase 2 going forward.

Business and Human Rights Treaty Negotiation Sees a Light at the End of the Tunnel

The 2016 decision on Argentina’s counterclaim in the Urbaser case provided a frustrating reminder that the international legal regime as it stands is insufficient in holding businesses accountable for human rights violations. Efforts are underway within the UN context to help address this challenge, though how effective the legally binding treaty on business and human rights will be in reconciling the human rights and investment law regimes will depend significantly on its design. It will also depend on how adjudicators treat it relative to other treaties, among other factors. This ITN Insight provides an update on the negotiating state of play for this binding treaty, based on the October 2019 talks in Geneva. It highlights important considerations for negotiators, drawing from lessons learned in international investment law and related areas.

What to Expect in the January 2020 Session of UNCITRAL Working Group III on ISDS Reform

The upcoming meeting of Working Group III of UNCITRAL in January 2020 will be a valuable opportunity to intensify the push for real reform of ISDS. This ITN Insight provides an update from the October 2019 discussions in Vienna, where countries set out a workplan for their upcoming talks on reform solutions, outlining when to discuss which options. The authors review lessons learned to date and look ahead to the topics slated for discussion in January 2020: a stand-alone review or appellate mechanism; a standing MIC; and the selection and appointment of arbitrators and adjudicators. Taking a deep dive into each, they highlight key issues for negotiators to consider.

News  |  December 17, 2019

UN Forum on Business and Human Rights highlights the importance of coherent policies

From November 25 to 27, 2019, the Office of the UN High Commissioner for Human Rights hosted this year’s United Nations Forum on Business and Human Rights in Geneva, Switzerland.

News  |  December 17, 2019

UNCTAD IIA Conference: WTO talks on investment facilitation take centre stage in break-out session

The UNCTAD High-Level IIA Conference, held in Geneva, Switzerland, in November 2019 featured a session dedicated to investment facilitation and promotion.

News  |  December 17, 2019

ECT modernization: Energy Charter Conference adopts mandate, confirms December talks

On November 6, 2019, the Energy Charter Conference confirmed that it would hold the first session of its “Modernization Group” on December 12, 2019, kicking off the process to revise the decades-old ECT.

News  |  December 17, 2019

Asia–Pacific leaders clinch RCEP trade and investment deal, pledge to continue talks with India

Leaders from 15 of the countries negotiating the Regional Comprehensive Economic Partnership (RCEP) announced on November 4, 2019, that they had clinched a deal that would govern trade and investment across a wide swath of the Asia–Pacific region.

News  |  December 17, 2019

Joint initiative on investment facilitation looks to “meaningful outcome” for WTO ministerial

The joint initiative being pursued by 92 WTO members on developing a multilateral framework on investment facilitation has reached a new phase, with various new participants involved and a push for significant progress ahead of a December stocktaking meeting.

News  |  December 17, 2019

Nord Stream 2: Pipeline spat with EU evolves into ECT dispute

A long-simmering row over plans for two new pipelines that would carry natural gas from Russia into Germany has advanced quickly in recent months, after gas company Nord Stream 2 submitted a notice of arbitration against the EU under the ECT on September 26, 2019.

News  |  December 17, 2019

U.S. officials raise concerns over proposed MIC in talks with the United Kingdom, documents say

A set of documents purporting to capture the discussions of the United States–United Kingdom Trade and Investment Working Group from 2018 has recently been released into the public domain.

Awards  |  December 17, 2019

Substantial damages awarded to Perenco for FET breach and expropriation; Ecuador also awarded compensation under environmental counterclaim

Perenco Ecuador Limited v. Republic of Ecuador, ICSID Case No. ARB/08/6

Awards  |  December 17, 2019

Dominant and effective nationality objection prevails in CAFTA-DR arbitration

Michael Ballantine and Lisa Ballantine v. The Dominican Republic, PCA Case No. 2016-17

Awards  |  December 17, 2019

All claims dismissed by ICSID tribunal in energy investor’s ECT case against Italy

Belenergia S.A. v. Italian Republic, ICSID Case No. ARB/15/40

Awards  |  December 17, 2019

Colombia is ordered to pay over USD 19 million for frustrating Glencore’s legitimate expectations

Glencore International A.G. and C.I. Prodeco S.A. v. Republic of Colombia, ICSID Case No. ARB/16/6

Awards  |  December 17, 2019

As claimants lacked a protected investment and could not import consent to arbitration via MFN, UNCITRAL tribunal dismisses case against Mauritius on jurisdictional grounds

Professor Christian Doutremepuich and Antoine Doutremepuich v. Republic of Mauritius, PCA Case No. 2018-37

Awards  |  December 17, 2019

Laos prevails in defending its first known treaty-based ISDS cases

Lao Holdings N.V. v. Lao People’s Democratic Republic, ICSID Case No. ARB(AF)/12/6, and Sanum Investments Limited v. Lao People’s Democratic Republic, UNCITRAL, PCA Case No. 2013-13

Awards  |  December 17, 2019

Tribunal finds Pakistan breached FET, expropriation and non-impairment obligations in the context of a mining joint venture with Australian investor Tethyan Copper Company

Tethyan Copper Company Pty Limited v. Islamic Republic of Pakistan, ICSID Case No. ARB/12/1

Awards  |  December 17, 2019

In yet another renewable energy case, Spain held liable for FET breach for frustrating French and Luxembourger investors’ legitimate expectations under the ECT

Cube Infrastructure Fund SICAV and Others v. The Kingdom of Spain, ICSID Case No. ARB/15/20

Awards  |  December 17, 2019

Despite a win for Estonia, ICSID arbitrators continue to resist CJEU’s Achmea judgment

United Utilities (Tallinn) BV and Aktsiaselts Tallinna Vesi v. Republic of Estonia, ICSID Case No. ARB/14/24

Politically Motivated Conduct in Investment Treaty Arbitration

Investment treaty arbitration is often expected to focus on technical issues. In practice, however, domestic political discussions and processes can have a major impact on investment disputes. The authors map out the variety of state conduct characterized by tribunals as politically motivated or influenced. They also examine the different ways in which arbitral tribunals have responded to host state conduct resulting from domestic political considerations.

Phase 2 of the UNCITRAL ISDS Review: Why “other matters” really matter

The April 2019 deliberations on multilateral ISDS reform at UNCITRAL Working Group III were due to tackle a series of questions that emerged in Phase 2 of the process. This piece breaks down why the scope of these discussions should be expanded to include important concerns raised by developing countries, and describes three core issues that must not be ignored. These involve the right to participation by affected parties; the rule of law and domestic courts’ jurisdiction; and the chilling of sovereign states’ authority and responsibility to govern.

Enhancing Environmental Protection in International Investment Law Through the Integration of International Civil Liability Principles

Investor–state arbitration has repeatedly proven ineffective in addressing environmental damages that host states suffer as a result of investment activities. This piece examines what lessons can be learned from international civil liability conventions, which are specifically designed to ensure victims’ compensation in cases of environmental harm. The author then explores which principles from these conventions could be adapted for use in investment treaties.

Protecting Social Rights Using the Amicus Curiae Procedure in Investment Arbitration: A smokescreen against third parties?

Arguments submitted by an amicus curiae (a “friend of the court”) have become increasingly common in investment arbitration. Many of these arguments deal with internationally recognized social rights, such as the right to water or food. This piece considers the restrictive conditions on amici curiae admission, the frequent reference to social rights issues in amici briefs, and the challenges in presenting these social rights arguments. The author advances possible actions that amici and states can take to make their social rights arguments more effective in an investment law context.